IAS 11 (Construction Contracts)

IAS 11 (Construction Contracts) - IAS 11 Construction...

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3/20/11 IAS 11 Construction Contracts 1
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3/20/11 Construction contracts IAS11 defines a construction contract as " a contract specifically negotiated for the construction of an asset or a combination of assets that are closely interrelated or interdependent in terms of their design, technology and function or their ultimate purpose or use ". Construction contracts include: contracts for the rendering of services that are directly related to the construction of assets (e.g. contracts for the services of project managers and architects); contracts for the destruction or restoration of assets and for the restoration of the environment after the demolition of assets. 2
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3/20/11 Characteristics of construction contracts A Unique features ü Signed before work is performed ü Stipulates progress billing criteria ü Covers several accounting periods ü Earnings process involves many events 3 Types of contracts ü Fixed price (escalation clauses) ü Cost-plus (allowable costs) 3
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3/20/11 Contract revenue
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IAS 11 (Construction Contracts) - IAS 11 Construction...

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